Since education makes a person more likely to leave your region, how do you justify your investment in human capital?

Monday, December 07, 2009

Costs Of Brain Drain

GlobalIrish wonders if there are any comparisons between Ireland's and Michigan's brain drain. Earlier this month, the Land Policy Institute published a report looking at the costs of out-migration. Indeed, population decline is bad for the local economy. What to do about it?

Population loss in many Michigan counties in the face of growing national population is cause for concern. There is a need to better understand the sources of population dynamics, the reversability of population shifts and the optimal strategies for population attraction and retention.

Despite all the fanfare, we still don't know how to best deal with the brain drain problem. I've linked to a post from 2008 that cites some studies of brain drain policies from 2003. The Land Policy Institute report indicates that not much, if anything, has improved. I'm looking forward to the next LPI publication.

Now, I'll quote part of the policy recommendations:

The loss of economic activity due to population decline is likely to be an increasingly important issue as the economy transitions further from a manufacturing-based economy to a service-based one. If jobs do follow people, as proponents of the New Economy concept propose, it makes sense to add to the retinue of existing strategies such policies that have the potential of attracting population. Many states, including Michigan, continue to focus on the attraction of job-laden businesses. However, in states experiencing population loss, it may be prudent to also consider policies to attract population, especially people with greater tendency to create jobs by their presence in the local economy. Evidence from the literature suggests that the entrepreneurial class, the talented, the creative class and other knowledge-based workers are attracted to places that are rich in amenities and that offer great quality of life (McGranahan and Wojan, 2007; Deller et al.; 2001). Therefore, strategies to recruit people to an area may well be fruitful, if they result in raising the demand for services and attracting knowledge based workers.

I've added the emphasis to the key part of the passage. I didn't see any mention of retention strategies save in conjunction with attraction and as a generic reference. I might be wrong, but I'd bet that side of the equation gets short shrift in the upcoming policy paper. Attraction receives all the attention in the current publication. The reason we know so little about attraction strategies is that our focus has been solely on talent retention. I'm still looking for a proven retention policy.

[El Paso Representative Susie Byrd] believes there are two types of expats: those who are looking to build a comfortable life with a clear career ladder and not much risk; and those who are entrepreneurs, the ones willing to take risks.

While she said she finds nothing wrong with those who have invested in their education and are looking for a stable career path, she feels that El Paso might not be the city to pursue those goals because the city’s wages are not competitive enough.

“But, hopefully, people like that (entrepreneurs) will see opportunity here,” she said. “We have a lot of folks like that in our economy right now, and we need even more of those.”

Christine Borne should find the above quote useful. When looking to turn the migration arrow around, target expatriates who would run through a wall to return home. These are the folks who moved the farthest away and/or thrived in an alpha global city. Rust Belt refugees would make for the best attraction target concerning domestic migrants.

Iowans have made countless efforts to stop the state's rural population drain. Former Gov. Tom Vilsack recruited former Iowans and welcomed immigrants. Groups worked to gussy up Main Street for a kind of nostalgic small-town tourism. Conference attendees listened to speakers who touted attracting a young, creative class of artists and entrepreneurs. Experts waited for the telecommuters who never came. Economic development officials hustled for small manufacturing plants that sometimes didn't pay much.

Population growth strategies of any kind seem to a lousy track record. I'm not too concerned since this is a policy frontier. And I still think the boomerang migration incubator is a winning idea. But I won't forget that we are just beginning to look at this problem with methodical analysis instead of the usual brain drain hysteria.

Beware of boondoggles and snake oil salespeople selling a cure for out-migration.

1 comment:

(1) When policymakers try to understand why people move away from their cities, how do they identify people to interview, anyway? It occurs to me that I moved away from Cleveland 3 years ago, and I've never been called by some Cuyahoga County Outmigration Research Council to find out why. Not that I expect them to, but I do wonder how these policy researchers find out why real people move away.

(2) For a city facing depopulation, why aren't there policies designed to encourage higher birth rates? If you can't get people to move in, why not get current residents to make more babies? They're trying it in Japan, anyway...